Farm Wage and Accommodation Calculator NZ
A great many farm jobs come with a house or with board, and that makes the wage arithmetic more complicated than it looks. This works out the deduction, what actually lands in the hand, and whether the arrangement still meets the minimum wage, which is the part that most often goes wrong. The rule people reach for is the Minimum Wage Act default: where there is no specific agreement about what the accommodation costs, an employer may deduct 15 percent of wages for board, meaning accommodation and meals, or 5 percent for lodging, meaning accommodation only, calculated at the relevant minimum wage rate. Two things about that are worth being clear on. It is a default for the absence of an agreement, not a cap on what can be agreed, and where a cost is agreed it has to be reasonable and it has to be recorded. And the minimum wage test applies to the wage before the deduction, not after it, because the agreed cost of accommodation counts as wages for that purpose. Wage records should show the pay before any accommodation deduction, which is why this page keeps the two figures separate and checks the minimum against the gross.
The minimum wage test is applied to the gross wage before the accommodation deduction, because the agreed cost of accommodation counts as wages for that purpose.
How it works
Gross pay is the hours multiplied by the hourly rate. If you have entered an agreed accommodation cost, that is the deduction. If you have not, the Act default applies: 15 percent for board or 5 percent for lodging, calculated on the hours at the relevant minimum wage rate rather than on the rate actually paid, which is what the Act specifies and which makes the default deduction the same for two people on different rates working the same hours. The net figure is the gross less the deduction, and the effective hourly rate divides that net back across the hours, which is the number that tells you what the job is really paying once the house is accounted for.
Where these arrangements go wrong
Usually in the record keeping rather than the arithmetic. A house that came with the job and was never priced in writing cannot be turned into a deduction later, and an agreed cost that is not reasonable is not saved by having been agreed. The minimum wage test is the other common trap, because it is applied to the gross wage: a worker on a rate above the minimum can have so much deducted that the effective rate falls below it, and the accommodation counting as wages is what makes that lawful only where the cost was genuinely agreed and reasonable. Long hours are the third, since the minimum wage is tested against all hours actually worked.
Worked example
A farm worker on 45 hours a week at $27.50 an hour grosses $1,237.50. With board provided and no agreed cost, the Act default deduction is 15 percent of 45 hours at the $23.95 minimum wage, which is $161.66. That leaves $1,075.84 in the hand, an effective rate of $23.91 an hour. The wage passes the minimum wage test, because the test applies to the $27.50 actually paid rather than to the effective rate after the deduction. Had the same worker been on $24.50 an hour, the gross would be $1,102.50, the deduction the same $161.66, and the pay would still pass, since $24.50 is above the minimum.
Related calculators
- Minimum Wage: the rates and who they apply to.
- PAYE Calculator: what comes off after this.
- True Cost of an Employee: the employer side.
- Farm Lease Rate: what the property costs to hold.
- Time and a Half Calculator NZ: overtime and Public Holiday Pay.
- Unpaid Wages Checker NZ 2026: Wage Theft and What You Are Owed.